Welcome back everyone. I am Cass PNC.
I'm joined, as usual, by my partner in crime, Mr. Bennett
Tomlin. How are?
You. I'm doing well.
How are you, Cass? I'm good.
We're talking about favorite person again, who we just can't
get enough of, Justin. Sun, get enough of us.
I'm sure I know he's a huge fan. Justin Sun, who created Tron and
bunch of stable coins bought bought some cryptocurrency
exchanges and is known as as as one of the wealthiest
cryptocurrency guys. We over at Protos have been
reporting on him lately and noticing some significant issues
with some of the projects that he's deeply intertwined with.
So I am going to turn it over to you, Bennett, where you can get
us started. I think probably the best place
to start is with Polonia X. Sure we can start with Polonia X
Polonia X is like the classic cryptocurrency shit coin trading
exchange. They used to even have like an
open chat box where all the shit coin to gens could like make
comments at each other while they were trading.
At one point it was bought by Circle and then it was bought by
Justin Sun, and since then it has gotten even worse.
At one point Justin promised that they were going to do a
proof of reserves to prove they were solvent.
That never happened for reasons which I think will become clear.
And since then there have been some other issues, one of which
involves a product called Wrapped Bitcoin on Tron.
Polonia X offers this product which allows people to get a
version of Bitcoin on Tron. The problem is Polonius won't
tell us where the bitcoins fit this product are held.
Sorry, sorry, sorry that I don't think that's like an accurate
enough description of what wrapped Bitcoin is necessarily
like. I think it would be nice for us
to help people understand in case they're unfamiliar with
cryptocurrency in general. Sure, Wrapped Bitcoin.
How it's supposed to work is you send your Bitcoin to a certain
address and you get a corresponding token on another
chain that's meant to represent that Bitcoin.
There's a common and very popular version of this on
Etherium that openly publishes like the addresses the Bitcoin
and stuff are stored in. Why would anyone want to do
that? Because they want to use Bitcoin
in Defy, right? Interact with various smart
contracts on the chain on Etherium generally or in this
case on Tron. So if you want to use Bitcoin in
a lending protocol or something like that on Tron, you got to
wrap it first and the most popular wrapper on Tron is this
one offered by Poloniux. But the problems like we said
our Polo won't tell you where the Bitcoin are Polo delisted
this asset it's not clear that any user can currently issue or
redeem this asset via Poloniux. Oh, and then Justin sends other
exchange HTX formally will be over half the Bitcoin on that
exchange. Is this version of Bitcoin over
on a Justin Sun connected just lend a Tron lending platform.
There are billions. There's like a huge portion of
this Bitcoin as well, making up the a big chunk of that.
And so Justin Sun has this Bitcoin product, but we don't
know if there's actually bitcoins that go with it.
And it makes up a huge portion of HT XS reserves.
And we don't know how much of Polonia XS reserves it makes up
because they still haven't done their proof of reserves.
That's one of the problems in Justin Sun's empire right now.
There are others, including the fact that USD is algorithmic
stable coin which was originally supposed to be a rip off of
Terra but like hasn't actually gotten to the point Terra was
ever at that one. There appears to only be 1 user.
Well, currently a bunch of the reserves for that coin, which
are presumably controlled by the Trondow reserve are for some
reason held at HTX and included in the HTX proof of reserves,
which kind of seems like you're double counting there, Justin,
kind of seems like you're putting money in two places.
Then we have the other stable coin that Justin's son probably
owns and we have to say probably because he keeps denying it
despite the large amount of evidence.
True USD, True USD has recently seen its market cap collapse
from like 3.5 billion to 450 million, losing like over 3
billion in the span of like a month and so Polonia X won't
show its reserves. HT XS reserves are fucked to
hell. There's a whole bunch of shit
going on with like the wobe Dow being converted to some new
token thing where he's trying to like screw over old token
holders for the old wobe whatever thing that never should
have existed in the 1st place. True USD his stable coin has
been like gutted and like they're not storing money at one
of their banks anymore. They still haven't fixed the
issues with their Swiss bank and like so this huge portion of
Justin Sons empire looks plausibly insolvent and Justin
Sun no longer even has diplomatic immunity to help him
get out of it. Yeah.
That was the other story that we we reported over at Protos was
that Justin Sun, who in addition to all of the stuff that you've
just heard, had to settle a court case in San Francisco.
He was under arbitration. It's not clear what the
settlement was for, but one of the claims that Justin Sun made
in this case repeatedly was that he had diplomatic immunity from
this lawsuit because he was not only the permanent
representative and ambassador to the World Trade Organization for
Granada, he was also the in chart like the ambassador for
technology and emerging like emerging innovation for Granada
to the United Nations. And so he believed that the
United Nations, I, I don't know if it if he actually believed
this. I have no idea what lawyers he's
speaking with or what. Grenada, Grenada, I guess I'm
saying it wrong. Grenada told him when he
received these. But I can I can tell you that
the UN says that diplomatic immunity does not apply
retroactively. So there was no way that he was
covered for this court case, regardless of whether it was for
the UN. And then we've previously
reported that the World Trade Organization ambassadorship that
he had is only good when he's on a mission in Switzerland.
So any other time when he was in any other place or not on a
mission, which is also quite common.
The UN said this as well, that unless they're on a mission,
generally they don't have diplomatic immunity at all.
It is actually, I don't think people think you're like granted
diplomatic immunity and it just applies all the time and for
anything. And that is definitely not the
case. It certainly was not the case
with Justin Sun. And yeah, it seems very clear
that he did get this special citizenship from Grenada
specifically because he thought it would give him diplomatic
immunity, which it didn't. So we don't, we know that he
lost those posts. We don't know what his
citizenship status is in Grenada or I, I believe he's in
Singapore, but I, I, who, who knows, Who knows what's going on
with him? It's a lot of little messes, but
it doesn't seem like anyone is too concerned about his, his
little empire. Maybe because it's so it's its
own little walled garden Perhaps.
And like, I think part of it is
that, like, he has such extensive control, despite him
pretending that Daos exist for some of these things, he has
such extensive control over so much of this.
And he has like a significant network of connections to
various people. Let me rephrase this.
You and I were talking about this recently.
Justin's son does have a significant pile of relatively
liquid coins and I think that has so far helped him paper over
a lot of other issues as they come up.
When USDD, for example, D pegs, he's able to bring it back to
peg. When there's issues with HTX,
he's able to send enough assets over there to keep withdrawals
open for some of these coins. And because he has this and my
guess is he also has other lenders and desks who are
extending him credit against the knowledge or against this pile
of somewhat liquid coins. And this gets into, I'm saying
liquid, they may not truly be like unencumbered liquid assets
he's supposed to be using in that way.
What I mean is he has assets he could easily sell in
cryptocurrency wallets he currently controls.
There may be other claims against them, but for now,
they're under his principal control.
And I think because of that, he's been able to kind of paper
it over. The other kind of wrinkled to
this and I think we talked about this a little bit when Boaz was
on is that Tron is is not significantly used in Tron is
far less significantly used in like the Western world, if you
want to call it that, right. Like trans major base of support
was far more in the East and many of like the issues over
there, even the ones that have been somewhat reported have not
seemed to have made their way into the like Western crypto
press in the same way. I remember when we were looking
at like the will be token shenanigans and stuff, Almost
all the people you could find like complaining and talking
about it. We're doing it like in Chinese,
not in English. And like that seemed to have
been the primary audience that was originally reached by the
token in that. And so I think that has somewhat
insulated Justin from the interest of the broader Western
crypto world. I will say that Tron is as much
as I, I think everything about it is a total shit show.
It is widely used in cryptocurrency, I think largely
just because it's quick. It's known as like a fast
cryptocurrency and that has created some sort of Moat for
it, though I would imagine we don't like you said, I like
there's all these Ethereum and Solana and all these other
whatever coins that are known for their defy usability.
I don't know if Tron has been able to build that out.
As much as Justin Sun pretends he has it it, it seems like it's
him who's building on Tron. And this gets to be kind of like
the wrinkle, right? Like you go and defy Lama and
you can see that Tron has a total value lot number that is
double Solana. Even BSc is still ahead of
Solana, believe it or not. But then you hear that number
being 8 point, whatever billion or whatever and you go, oh, how
much of that is just Justin? Like if WBTC on just lend a loan
is over a billion dollars and we don't know that there's actually
bitcoins that go with it. Like what does that 8 billion
number actually mean or whatever, right.
And so you end up in like that makes it, in my opinion, also
harder to assess Tron in the grand scheme of things.
Well similar to Etherium I think most of the transactions that
are occurring tell me if I'm wrong, but most of the
transactions occurring fake or not are USDT are are tethered
transactions on on Tron right? I don't know, probably
especially with Justin doing some shenanigans with his staked
USDT, which like 99% we said was going to like entities connected
to him or whatever. And so again, this is and like
staked USDT, this other thing that's almost all going to
Justin makes up a big portion of the USDT reserves on HTX,
further contributing to our aforementioned likely
insolvency. Like this entire thing is an
interconnected insolvent mess that is like one indictment away
from a multi billion dollar collapse.
Is there any real idea or threat or concept that Tron?
Like there could be the the chain could get destroyed that
that it could get shut down that all the validators and nodes
could get. Like is there any realistic idea
that that could happen with Tron?
So the largest staker on Tron seems to be Binance staking,
followed by something called Crypto Labs, which poke some of
these too hard and see who's behind them.
The third largest is Luganodes, which is Tether funded.
Then you get to something called and that like this is the
problem is it's kind of hard to get into some of these.
Then you get like metaverse home, which I don't know who
that is. JD investment could be anyone.
Poloniak's Hey, we're back at Justin's Sun Intelligence Quant
could be anyone Crypto AI could be anyone who will be wallet.
Hey, we're back at Justin Sun, Tron Alliance, Justin Sun
Valkyrie Investments, Justin Sun Justin doesn't own Valkyrie.
He's just like 80% of their AUM. And so I am not sure I haven't
gone deep enough on like Tron's consensus algorithm.
And frankly, there's probably not very many people who have
who can like, accurately start to figure out what, like, how
secure is Tron? Really, here's something I'll
say. I don't think until I see any
government, I would. I would expect if any government
entity were to attack a blockchain, I, I don't know if
that's the right word, but take over, seize a blockchain.
I assume it would be the US, but until I see them do it, I I
really wouldn't expect them to do it.
I wouldn't expect them to put all that effort and energy into
something like that. I.
Think you're right. I think that it is very unlikely
they would do that. Like you can already get all the
blockchain information without having to do that, right.
So it's not like doing that's giving you some secret insight.
And generally the government's going to prefer to go after like
registered entities with addresses and people and things
like that. And they're just going to like
if let's say, let's pretend, let's pretend the US government
decides we hate that people can transact and Tron.
You like, try to get Tron named as security.
You crack down on any exchange that lists it.
You go after financial service providers that are providing
like rails to Tron. You go after any like Tron nodes
and validators in the United States.
And you can do all those things without ever having to try to
like, take over. Tron, you know how you do all of
those things. You arrest Justin's son.
Which of? Course, we don't know that
that's what they're going to do. Oh no, I'm to be clear, I want
to make sure everyone understands.
I would never suggest that. I'm not, you know, I'm not
making any suggestions, questions about actual
criminality here. This isn't, this isn't court
anyway, you know, Justin, I want to, I just want to let you know,
I hope we're still invited to the Tron Christmas party.
We, we didn't mean anything bad by reporting on you and
everyone. If, if you want to see Justin,
come on the podcast. If you want to see him join us,
remember to hit that like and subscribe button because I, I, I
think Justin, I think we've reached out to him.
He's, he's interested, right? Oh almost definitely.
I'm sure he'll be on here any day.
Right after he answers some questions about why Polonia XD
listed WBTC. Yeah, I would love for him to
just come join us in studio, come to the US.
Just a nice little chat.